FORM 8-A
SECURITIES AND EXCHANGE COMMISSION
Washington, DC 20549
FOR REGISTRATION OF CERTAIN CLASSES OF SECURITIES
PURSUANT TO SECTION 12(b) or (g) OF THE
SECURITIES EXCHANGE ACT OF 1934
DCI Telecommunications, Inc.
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(Exact name of registrant as specified in its charter)
Colorado 84-1155041
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(State or other (IRS Employer
jurisdiction of Identification
incorporation) Number)
611 Access Road, Stratford, CT 06615
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(Address of principal executive offices)
Securities to be registered pursuant to Section 12(b) of the Act:
Title of each class Name of each exchange on which
to be registered each class is to be registered
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Not applicable
Securities to be registered pursuant to Section 12(g) of the Act:
Common Stock
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(Title of Class)
Item 1. Description of Registrant's Securities to be Registered
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The securities to be registered are the shares of common stock, par
value $0.0001 (the "Common Stock") of DCI Telecommunications, Inc.
(the "Registrant"). The number of shares authorized is five-hundred
million (500,000,000).
Subject to the preferences, qualification, limitation, voting rights
and restrictions that may apply to shares of Preferred Stock
outstanding at the time, the holders of outstanding shares of Common
Stock are entitled to receive dividends out of assets legally
available therefor at such times and in such amounts as the Board of
Directors may from time to time determine. Each stockholder is
entitled to one vote for each share of Common Stock held on all
matters submitted to a vote of stockholders. Cumulative voting for
the election of directors is not provided for in the Company's
Certificate of Incorporation, which means that the holders of a
majority of the shares voted can elect all of the directors then
standing for election. The Common Stock is not entitled to preemptive
rights and is not subject to conversion or redemption. Upon the
occurrence of a liquidation, dissolution or winding-up of the
Registrant, the holders of shares of Common Stock would be entitled
to share ratably in the distribution of all of the Registrant's
assets remaining available for distribution after satisfaction of all
its liabilities and the payment of the liquidation preference of any
outstanding Preferred Stock. Each outstanding share of Common Stock
is fully paid and non-assessable.
The Board of Directors has the authority, within the limitations and
restrictions stated in the Certificate of Incorporation of the
Registrant, to provide by resolution for the issuance of shares of
Preferred Stock, in one or more classes or series, and to fix the
rights, preferences, privileges and restrictions thereof, including
dividend rights, conversion rights, voting rights, terms of
redemption, liquidation preferences and the number of shares
constituting any series or the designation of such series.
The Registrant presently has one series of Preferred Stock issued and
outstanding, this being two thousand three-hundred and three (2,303)
shares of Class A, Series F, Convertible Preferred Stock, $1,000
stated value per share.
Except as provided by law or by the provisions below, holders of
Series F Convertible Preferred Stock shall not have the right to vote
on any matter affecting the Registrant.
In the event of a voluntary or involuntary dissolution, liquidation,
or winding up of the Registrant, the Holders of shares of Series F
Convertible Preferred Stock shall be entitled to receive out of the
assets of the Registrant legally available for distribution to
holders of its capital stock, before any payment or distribution
shall be made to holders of Common Stock or any other class of stock
ranking junior to Series F Convertible Preferred Stock, an amount per
share equal to $1,000 (the "Stated Value"). If upon such
liquidation, dissolution or winding up of the Registrant, whether
voluntary or involuntary, the assets to be distributed among the
Holders of Series F Convertible Preferred Stock shall be insufficient
to permit payment to the Holders of Series F Convertible Preferred
Stock of the amount distributable as aforesaid, then the entire
assets of the Registrant to be so distributed shall be distributed
ratably among the holders of Series F Convertible Preferred Stock.
Upon any such liquidation, dissolution or winding up of the
Registrant, after the holders of Series F Convertible Preferred Stock
shall have been paid in full the amounts to which they shall be
entitled, the remaining net assets of the Registrant may be
distributed to the holders of stock ranking on liquidation junior to
the Series F Convertible Preferred Stock
Item 2. Exhibits.
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The following exhibit required in accordance with the Instructions as
to exhibits on Form 8-A is incorporated by reference:
Exhibit 1: Bylaws of the Registrant. Filed with Form 8K dated
June 28, 1995.
The following exhibits required in accordance with the Instructions
as to exhibits on Form 8-A are attached:
Exhibit 2: Articles of Incorporation of the Registrant as Restated.
Exhibit 3: Certificate of Designation of Rights and Preferences of
the Class A Preferred Shares Series F
Exhibit 4: Specimen Common Stock Certificate.
Signature
Pursuant to the requirements of Section 12 of the Securities
Exchange Act of 1934, the registrant has duly caused this
registration statement to be signed on its behalf by the undersigned,
thereto duly authorized.
DCI Telecommunications, Inc.
Date: July 15, 1999
By: /s/ Joseph J. Murphy
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Joseph J. Murphy
President & CEO
Exhibit 2
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Articles of Incorporation of the Registrant as Restated
DCI TELECOMMUNICATIONS, INC.
Pursuant to the Colorado Corporation Code, Section 7-110-107, the
Board of Directors of DCI Telecommunications, Inc. has this 14th day
of August 1998 duly adopted this Restatement of Articles of
Incorporation in the manner prescribed by the Colorado Corporate
Code, and said Restatement of the Articles was adopted without
shareholder approval, and no amendments were made to the Articles of
Incorporation which would require shareholder approval.
ARTICLE I
NAME OF CORPORATION
The name of the corporation is DCI Telecommunications, Inc.
ARTICLE II
PURPOSE
The purpose of the Corporation shall be to transact all lawful
business for which corporations may be incorporated pursuant to the
Colorado Corporation Code, as amended. The Corporation shall have
the power to do all and everything necessary, suitable and proper for
the accomplishment of its purpose.
ARTICLE III
DURATION
The duration of the corporation shall be perpetual.
ARTICLE IV
CAPITAL
COMMON STOCK
The aggregate number of shares of common stock the Corporation shall
have authority to issue is Five Hundred Million (500,000,000) having
a par value of $.0001 per share, which shares shall be designated as
"Common Stock" or "Common Shares".
PREFERRED STOCK
The aggregate number of shares of preferred stock the Corporation
shall have authority to issue is Nine Million (9,000,000) shares.
Class "A" Preferred Stock. Five Million (5,000,000) shares of such
preferred stock shall be known as Class "A" Preferred Stock and shall
have a par value of $100.00 per share.
Class "B" Preferred Stock. Four Million (4,000,000) shares of such
preferred stock shall be known as Class "B" Preferred Stock and shall
have a par value of $10.00 per share.
1. Series. Each Class of Preferred Stock may be issued, from time
to time, in one or more series as determined by the Board of
Directors. Each series shall be designated either Class "A" or Class
"B" as the case may be, with a distinguishing letter for each series.
The first of such series for either Class "A" or Class "B" shall be
designated "Series A" and the second of such series shall be
designated "Series B". All shares of a series shall have preferences,
limitations, and relative rights identical with those of other shares
of the same series and, except to he extent otherwise provided in the
description of the series, with those of other series of the same
class. Each series of Preferred Shares may be issued upon such terms
and for such purposes as the Board of Directors may determine from
time to time, provided, however, that no subsequent Series of
Preferred Shares may in any way adversely effect the rights or rank
of any preceding series of Preferred shares.
Before issuing any shares of a class or series, the preferences,
limitations, and relative rights of which are determined by the Board
of Directors, the Corporation shall deliver to the Secretary of State
for filing articles of amendment to the these Articles, which are
effective without shareholder approval, that set forth:
(a) The name of the Corporation;
(b) The test of the amendment determining the designations,
preferences, limitations, and relative rights of the class or series
of shares;
(c) The date the amendment was adopted; and
(d) A statement that the amendment was duly adopted by the Board of
Directors.
2. Dividends On Preferred Shares. The holders of the Preferred
Shares shall be entitled to receive out of any funds of the
Corporation at the time legally available for the declaration of
dividends, dividends of 9.25% per annum, and no more, payable
quarterly (on April 1, July 1, September 1, and January 1), when and
as declared by the Board of Directors. Such dividends shall accrue
from the date of issuance of the respective Preferred Shares and
shall accrue from day to day whether or not earned or declared, Such
dividends shall be cumulative and shall be declared and paid, or set
apart for payment, before any dividends on shares of Common Stock is
paid or set apart for payment. The amount of deficiency shall be
paid in full and set apart for payment, without interest, before any
distribution, whether by way of dividend or otherwise, shall be paid
upon or set apart for the Common Stock.
3. Dividends On Other Shares. At any time after all dividends on the
Preferred Shares for all previous dividend periods shall have been
declared and paid in full and dividends on the outstanding Preferred
Shares for the current dividend period have been declared and paid in
full or set apart for payment in full, dividends may be paid on
outstanding Common Stock out of any assets at the time legally
available therefor. Any dividend so declared shall be distributed
among and paid to the holders of the outstanding Common Stock without
distinction according to their respective shares.
4. Voting Rights. Except as otherwise provided by law or these
Articles of Incorporation, the holders of Preferred Shares shall not
be entitled to notice of shareholders' meetings or to vote upon the
election of directors or upon any questions affecting the management
or affairs of the Corporation, except where such notice or vote is
required by law or by these Articles of Incorporation.
5. Liquidation. In the event of any liquidation or dissolution or
winding up of the Corporation, either voluntary or involuntary, the
holders of the Series A Preferred Shares shall be entitled to be
paid, before any of the assets of the Corporation shall be
distributed among or paid over to the holders of the Series B
Preferred Shares or Common Stock, an amount equal to the par value of
such Series A Preferred Shares plus any accumulated dividends accrued
and unpaid on the Series A Preferred Shares.
After the holders of the Series A Preferred Shares shall nave
received the amount of the par value thereof plus accrued dividends,
any remaining assets and surplus funds of the Corporation shall be
distributed to the holders of the Series B Preferred Shares before
any of the assets of the Corporation shall be distributed among or
paid over to the holders of the Common Stock an amount equal to the
accumulated dividends accrued and unpaid on the Series B Preferred
Shares.
After the holders of the Series B Preferred Shares have received the
amount of the par value thereof plus accrued dividends, any remaining
assets and surplus funds of the Corporation shall be distributed
among and paid over to the holders of the Common Stock without
distinction according to their respective shares.
6. Conversion. The holder of each share of the outstanding
Preferred Shares of the Corporation shall have the right at any time
on or before January 1, 1997, to surrender the certificate evidencing
such shares and receive, in lieu and in conversion thereof, a
certificate evidencing sixty-six and two-thirds shares of Common
Stock of the Corporation for each Series A Preferred Share of the
Corporation so surrendered or two hundred shares of Common Stock of
the Corporation for each Series B Preferred Share of the Corporation
so surrendered. The convertible Preferred Shares so exchanged and
converted shall not be reissued by the Corporation.
To convert, a preferred shareholder must (1) complete and sign the
Conversion Form attached to the back of each Certificate of Preferred
Shares, (2) surrender the Preferred Shares to a Conversion Agent or
the Corporation, (3) furnish appropriate endorsements and transfer
documents if required by the Registrar or Conversion Agent, and (4)
pay any transfer or similar tax if required. A holder may convert a
portion of Preferred Shares if the portion is $1,000.00 or a whole
multiple of $1,000.00.
The Corporation shall at the time of such conversion pay to the
holder of record of any share or shares of Series A or Series B
Preferred Stock any accrued but unpaid dividends on said Preferred
Stock so surrendered for conversion, except that no payment or
adjustment shall be made for any accrued but unpaid dividends for the
then current quarter-annual dividend period.
7. Conversion Adjustment. In the event the Corporation shall at any
time prior to such conversion either (a) subdivide the outstanding
Common Shares into a greater number of shares, (b) combine the
outstanding Common Shares into a small number of shares, (c) change
the outstanding Common Shares into the same or a given number of
shares of any other class or classes of shares, (d) declare on or in
respect of the Common Shares a dividend payable in shares or other
securities of the Corporation, or (e) offer to the holders of Common
Shares any rights to subscribe for shares or for other securities of
the Corporation, then the holders of the Preferred Shares shall be
entitled, as the case may be, to receive the same number of Common
Shares or shares of any other class or classes of shares or other
securities of the Corporation, or shall be entitled to subscribe for
and purchase at the same price that the shares or securities are
offered to holders of Common Shares, the number of such shares or the
amount of such securities as will represent the same proportion of
the outstanding Common Shares prior to such increase or decrease as
they would have been entitled to receive or subscribe for, as the
case may be, had they been holders of the number of Common Shares in
to which their Preferred Shares were convertible on the record date
for any such dividend or subscription.
8. Merger. In the event the Corporation at any time while any of
the Preferred Shares are outstanding shall be consolidated with or
merged into any other corporation or corporations, or shall sell or
lease all or substantially all of its property and business as an
entirety, lawful provisions shall be made as part of the terms of
such consolidation, merger, sale or lease that the holder of any
convertible Preferred Shares may thereafter receive in lieu of such
Common Shares otherwise issuable to him upon conversion of his
Preferred Shares, but at the conversion rate which would otherwise be
in effect at the time of conversion as hereinabove provided, the same
kind and amount of securities or assets as may be issuable,
distributable or payable upon such consolidation, merger, sale or
lease, with respect to Common Shares of the Corporation.
9. Fractional Shares. The Corporation shall not issue fractional
shares in satisfaction of the conversion privilege of the Preferred
Shares, but in lieu of fractional shares, the Corporation at its
option may make a cash settlement in respect thereof on the basis of
the closing price od the Common Shares on the date of conversion, or
may issue scrip certificates aggregating one or more full shares for
certificates representing such full share or shares. Until the
exchange thereof for certificates representing full Common Shares,
the holder of any certificated shall not be entitled to receive
dividends thereon, to vote by virtue thereof as a shareholder of the
Corporation, except such rights, if any, as the Board of Directors
may in its discretion determine in the event of dissolution of the
Corporation.
10. Common Shares. Subject to the preferences, qualification,
limitation, voting rights and restrictions with respect to each class
of the authorized shares of the Corporation having any preference or
priority over the Common Shares, the holders of the Common Shares
shall have and possess all rights appertaining to authorized shares
of the Corporation.
11. Preemptive Right. No holder of shares of any class of the
Corporation shall be entitled as of right to subscribe for, purchase
or receive any part of any new or additional shares of any class,
whether now or hereafter authorized, or of bonds, debentures or other
evidences of indebtedness convertible into or exchangeable for
shares, but al such new or additional shares of any class, or bonds,
debentures or other evidences of indebtedness convertible into or
exchangeable for shares, may be issued and disposed of by the Board
of Directors on such terms and for such consideration, so far as may
be permitted by law, and to such person or persons as the Board of
Directors in their absolute discretion may deem advisable.
12. Corporate Debt. Without the prior approval of a majority of the
holders of the Series A Preferred Shares, neither the Corporation nor
any of its subsidiary corporations shall incur debt in excess of One
Million Dollars, provided however, the Corporation or any of its
subsidiaries shall have the authority to enter into factoring
agreements or factoring arrangements covering its inventory or the
inventory of any of its subsidiaries as it deems necessary and
reasonable.
ARTICLE V
RIGHTS OF DIRECTORS AND OFFICERS TO CONTRACT WITH THE COMPANY
Any of the Directors or Officers of the Corporation shall not, in the
absence of fraud, be disqualified by his office from dealing or
contracting with the Corporation either as vendor, purchaser, or
otherwise, nor shall any firm, association or corporation of which he
shall be a member or in which he may be pecuniarily interested in any
manner be so disqualified. No director, officer, nor any firm,
association or corporation with which he is connected as aforesaid
shall be liable to account to this corporation or its shareholders
for any profit realized by him from or through any such transaction
or contract, it being the express purpose and intent of this Article
to permit the Corporation to buy from, sell, to venture with, or
otherwise deal with partnerships, firms, or corporations of which the
directors or officers of the Corporation, or any one or more of them,
may be members, directors, or officer, or in which they or any of
them may have any pecuniary interests: and the contracts of the
Corporation, in absence of fraud, shall not be void or voidable or
affected in any manner by reason of any such position. Furthermore,
Directors of the Corporation at a meeting even though they may be
pecuniarily interested in matters with reference to such meeting and
considered at such meeting and any such action taken at such meeting
with reference to such matters by a majority of the disinterested
directors, shall not be void or voidable by the Corporation in the
absence of fraud.
Any Director may be counted in determining the existence of a quorum
and may vote at any meeting of the Board of Directors of the
Corporation for the purpose of authorizing any such contract or
transaction with like force and effect as if he were not so
interested, or were not a director, member or officer of such other
corporation, firm, association or partnership.
ARTICLE VI
TRANSFER RESTRICTIONS
The Corporation shall have the right to impose restrictions upon the
transfer of any of its authorized shares or any interest therein.
The Board of Directors is hereby authorized on behalf of the
Corporation's right to so impose such restrictions, whether by
provision in the Bylaws or otherwise.
ARTICLE VII
VOTING
Cumulative voting shall not be allowed.
ARTICLE VIII
ADOPTION AND AMENDMENT OF BYLAWS
The Bylaws of the Corporation shall be adopted by its Board of
Directors. The power to alter or amend or repeal the Bylaws or adopt
new Bylaws shall be vested in the Board of Directors, but the
Shareholders may also alter, amend or repeal the Bylaws or adopt new
Bylaws. The Bylaws may contain any provision for the regulation and
management of the affairs of the Corporation not inconsistent with
statute or the Articles of Incorporation.
ARTICLE IX
REGISTERED OFFICE AND AGENT
The address of the registered office and agent of the Corporation is
The Corporation Company, 1675 Broadway, Denver, CO 80202.
ARTICLE X
INDEMNIFICATION
Section 10.1 General Right of Indemnification. The Corporation
may indemnify any person who was or is a party or is threatened to be
made a party to any threatened, pending, or completed action, suit,
or proceeding, whether civil, criminal, administrative, or
investigative (other than an action by or in the right of the
Corporation) by reason of the fact that he is or was a Director,
Officer, employee, fiduciary or agent of the Corporation or is or was
serving at the request of the Corporation as a Director, Officer,
employee, fiduciary or agent of another corporation, partnership,
joint venture, trust, or other enterprise, against expenses
(including attorney fees) reasonably incurred by him in connection
with such action, suit, or proceeding, if he acted in good faith and
in a manner he reasonably believed to be in the best interest of the
Corporation and, with respect to any criminal action or proceeding,
had no reasonable cause to believe his conduct was unlawful. The
termination of any action, suit, or proceeding by judgment, order,
settlement or conviction or upon a plea of nolo contendere or its
equivalent shall not of itself create a presumption that the person
did not act in good faith and in a manner which he reasonably
believed to be in the best interest of the Corporation and, with
respect to any criminal action or proceeding, had no reasonable cause
to believe his conduct was unlawful.
Section 10.2 Limitation for Negligence or Misconduct. The
Corporation may indemnify any person who was or is a party or is
threatened to be made a party to any threatened, pending or completed
action or suit by or in the right of the Corporation to procure a
judgment in its favor by reason of the fact that he is or was a
director, officer, employee or agent of the Corporation or is or was
serving at the request of the Corporation as a Director, Officer,
employee, fiduciary or agent of another corporation, partnership,
joint venture, trust or other enterprise against expenses (including
attorney fees) actually and reasonably incurred by him in connection
with the defense or settlement of such action or suit if he acted in
good faith and in a manner he reasonably believed to be in the best
interests of the Corporation; but no indemnification shall be made in
respect of any claim, issue, or matter as to which such person has
been adjudged to be liable for negligence or misconduct in the
performance of his duty to the Corporation unless, and only to the
extent that the court in which such action or suit was brought
determines upon application that, despite the adjudication of
liability, but in view of all circumstances of the case, such person
is fairly and reasonably entitled to indemnification for such
expenses which such court deems proper.
Section 10.3 Success on Merits. To the extent that a Director,
Officer, employee, fiduciary or agent of the Corporation has been
successful on the merits in defense of any action, suit or proceeding
referred to in Section 10.1 and 10.2 or in defense of any claim,
issue or matter therein, he shall be indemnified against expenses,
including attorney fees, actually and reasonably incurred by him in
connection therewith.
Section 10.4 Majority Vote. Any indemnification under Section
10.1 or 10.2 (unless ordered by a court) and as distinguished from
Section 10.3 shall be made by the Corporation only as authorized in
the specific case upon a determination that indemnification of the
Director, Officer, employee, fiduciary or agent is proper in the
circumstances because he has met the applicable standard of conduct
set forth in Section 10.1 or 10.2 above. Such determination shall be
made by the Board of Directors by a majority vote of a quorum
consisting of Directors who were not parties to such action, suit or
proceeding, or, if such a quorum is not obtainable or, even if
obtainable, if a quorum of disinterested Directors so directs, by
independent legal counsel in a written opinion, or by the
Shareholders.
Section 10.5 Advance Payment. Expenses, including attorney fees,
incurred in defending a civil or criminal action, suit, or proceeding
may be paid by the Corporation in advance of the final disposition of
such action, suit, or proceeding as authorized in Sections 10.3 or
10.4 upon receipt of an undertaking by or on behalf the Director,
Officer, employee, fiduciary or agent to repay such amount unless it
is ultimately determined that he is entitled to be indemnified by the
Corporation as authorized in this Article.
Section 10.6 Non-Exclusive. The indemnification provided by this
Article shall not be deemed exclusive of any other rights to which
those indemnified may be entitled under any Bylaw, agreement, vote of
Shareholders or disinterested Directors, or otherwise, and any
procedure provided for by any of the foregoing, both as to action in
his official capacity and as to action in another capacity while
holding such office, and shall continue as to a person who has ceased
to be a Director, Officer, employee, fiduciary or agent and shall
inure to the benefit of heirs, executors, and administrators of such
a person.
Section 10.7 Insurance. The Corporation may purchase and maintain
insurance on behalf of any person who is or was a Director, officer,
employee, fiduciary or agent of the Corporation or who is or was
serving at the request of the Corporation as a director, officer,
employee, fiduciary or agent of another corporation, partnership,
joint venture, trust, or other enterprise against any liability
asserted against him and incurred by him in any such capacity or
arising out of his status as such, whether or not the Corporation
would have the power to indemnify him against such liability under
the provisions of this Article.
ARTICLE XI
EXECUTIVE AND OTHER COMMITTEES
The Board of Directors, by resolution adopted by a majority of the
full Board of Directors, may designate from among its members an
executive committee, and one or more other committees, each of which,
to the extent provided in the resolution, shall have all of the
authority of the Board of Directors; except that no such committee
shall have the authority to:
(i) Declare dividends or distributions;
(ii) Approve or recommend to Shareholders actions or
proposals required by the Colorado Corporation Code to be approved by
Shareholders;
(iii) Fill vacancies on the Board of Directors or any
committee thereof;
(iv) Amend the Bylaws;
(v) Approve a plan of merger not requiring
Shareholders approval;
(vi) Reduce earned or capital surplus;
(vii) Authorize or approve the reacquisition of shares
unless pursuant to general formula or method specified by the Board
of Directors; or
(viii) Authorize or approve the issuance or sale of, or any
contract to issue or sell, shares or designate the terms of a series
of a class of shares.
Neither the designation of any such committee by said Board of
Directors, the delegation of authority to such committee, nor any
action by such committee pursuant to its authority shall constitute
compliance by any member of the Board of Directors, not a member of
the committee in question, with his responsibility to act in good
faith, in a manner he reasonably believes to be in the best interests
of the Corporation, and with such care as an ordinarily prudent
person in a like manner would use under similar circumstances.
ARTICLE XII
INITIAL BOARD OF DIRECTORS
The initial Board of Directors of the Corporation shall consist of
three (3) directors. The number of Directors may from time to time
be increased or decreased in such a manner as shall be provided in
the Bylaws of this Corporation, providing that the number shall not
be reduced to less than three (3) unless the number of Shareholders
in the Corporation is less than three (3), in which event the number
of Directors may be equal to the number of Shareholders.
Dated this 14th day of August, 1998.
_________________________ ____________________________
_________________________ ___________________________
STATE OF CONNECTICUT )
) ss
COUNTY OF )
On this 14th day of August, 1998, before me the undersigned, a Notary
Public for the State of Connecticut, personally appeared
_________________________________________________________
_________________________________________________________
who being by me first duly sworn, declared that he is the person who
signed the foregoing document as Director of DCI Telecommunications,
Inc., a Colorado corporation, and that the statements therein
contained are true.
IN WITNESS WHEREOF, I have hereunto set my hand and seal the day and
year first above written.
__________________________________
Notary Public
My Commission expires ____________ (SEAL)
Exhibit 3
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CERTIFICATE OF DESIGNATION
OF RIGHTS AND PREFERENCES OF THE
CLASS A PREFERRED SHARES SERIES F OF
DCI TELECOMMUNICATIONS INC.
PURSUANT TO THE GENERAL CORPORATION LAW
OF THE STATE OF COLORADO
We, being respectively the President and Acting Secretary of DCI
Telecommunications Inc. a corporation organized and existing under
and by virtue of the General Corporation Law of the State of Colorado
(hereinafter the "Corporation"), DO HEREBY CERTIFY:
FIRST:
That pursuant to authority expressly granted and vested in the Board
of Directors of said Corporation by the provisions of the Certificate
of Incorporation, said Board of Directors adopted the following
resolution setting forth the designations, powers, preferences and
rights of its Class A Preferred Shares - Series F:
RESOLVED: That the designations, powers, preferences and rights of
the Class A Preferred Shares - Series F be, and hereby are, as set
forth below:
1. Number of Shares of Class A Preferred Shares - Series F.
Of the 9,000,000 shares of authorized and unissued Class A Preferred
Shares, $.01 par value per share ("Preferred Shares") of the
Corporation, three thousand (3,000) shares shall be designated and
known as "Series F Convertible Preferred Shares."
2. Voting.
(a) Except as provided by law or by the provisions of Subparagraph
2(b) below, holders of Series F Convertible Preferred Shares
("Holder" or "Holders") shall not have the right to vote on any
matter affecting the Corporation.
(b) The Corporation shall not amend, alter or repeal the
preferences, special rights or other powers of the Series F
Convertible Preferred Shares so as to affect adversely the Series F
Convertible Preferred Shares, without the written consent or
affirmative vote of the Holders of at least a majority of the then
outstanding shares of Series F Convertible Preferred Shares to be
affected by amendment, alteration or repeal, given in writing or by
vote at a meeting, consenting or voting (as the case may be)
separately as a class. For this purpose, without limiting the
generality of the foregoing, the authorization or issuance of any
series of Preferred Shares with preference or priority over or on a
parity with the Series F Convertible Preferred Shares as to the right
to receive either dividends or amounts distributable upon
liquidation, dissolution or winding up of the Corporation shall not
be deemed to affect adversely the designated class of Series F
Convertible Preferred Shares.
3. Not Used
4. Not Used
5. Liquidation.
In the event of a voluntary or involuntary dissolution, liquidation,
or winding up of the Corporation, the Holders of shares of Series F
Convertible Preferred Shares shall be entitled to receive out of the
assets of the Corporation legally available for distribution to
holders of its capital stock, before any payment or distribution
shall be made to holders of Common Stock or any other class of stock
ranking junior to Series F Convertible Preferred Shares, an amount
per share equal to $1,000 (the "Stated Value"). If upon such
liquidation, dissolution or winding up of the Corporation, whether
voluntary or involuntary, the assets to be distributed among the
Holders of Series F Convertible Preferred Shares shall be
insufficient to permit payment to the Holders of Series F Convertible
Preferred Shares of the amount distributable as aforesaid, then the
entire assets of the Corporation to be so distributed shall be
distributed ratably among the holders of Series F Convertible
Preferred Shares. Upon any such liquidation, dissolution or winding
up of the Corporation, after the holders of Series F Convertible
Preferred Shares shall have been paid in full the amounts to which
they shall be entitled, the remaining net assets of the Corporation
may be distributed to the holders of stock ranking on liquidation
junior to the Series F Convertible Preferred Shares. Written notice
of such liquidation, dissolution or winding up, stating a payment
date, the amount of the liquidation payments and the place where said
liquidation payments shall be payable, shall be given by mail,
postage prepaid or by telex or facsimile to non-U. S. residents, not
less than 10 days prior to the payment date stated therein, to the
Holders of record of Series F Convertible Preferred Shares, such
notice to be addressed to each such Holder at its address as shown by
the records of the Corporation. For purposes hereof, the Common Stock
shall rank on liquidation junior to the Series F Convertible
Preferred Shares.
6. Restrictions.
The Corporation will not modify the terms of the Series F Convertible
Preferred Shares at any time when shares of Series F Convertible
Preferred Shares are outstanding, without the approval of the Holders
of at least a two-thirds majority of the then outstanding shares of
Series F Convertible Preferred Shares given in writing or by vote at
a meeting, consenting or voting (as the case may be) separately as a
series, except where the vote or written consent of the Holders of a
greater number of shares of the Corporation is required by law or by
the Corporation's Certificate of Incorporation, as amended.
7. Optional Conversion.
If the Corporation has not sent to Holder a Redemption Notice per
Section 9, and subject to the Corporation's right to redeem Series F
Convertible Preferred Shares, the Holders of shares of Series F
Convertible Preferred Shares shall have the following conversion
rights:
(a) Conversion Terms. Each record Holder of Series F Convertible
Preferred Shares shall be entitled (at the times and in the amounts
set forth below) and subject to the Company's right of redemption set
forth in Section 9, at the office of the Company or any transfer
agent for the Series F Convertible Preferred Shares (the Transfer
Agent), to convert (in multiples of one (1) share of Series F
Convertible Preferred Shares) such Series F Convertible Preferred
Shares into Common Stock at the lesser of (a) $4.00 per share of
Common Stock or (b) the average of the two lowest closing bid prices
of the Corporations Common Stock as quoted by Bloomberg, LP for the
ten-day trading period (the Look-Back Period) ending on the day prior
to the date of conversion (the Average Price) times seventy five
percent (75%) (the Conversion Price). Starting on the first day of
the fifth month from the Closing Date the Look-Back Period will be
increased one day per month up to a maximum of twenty-two days.
(b) Conversion Dates.
1. Limitations on Conversion. The Holder of any share or shares
of Series F Convertible Preferred Shares may not convert any of such
shares for a period of at least eighty-nine (89) calendar days
following the Closing Date. Closing Date shall mean the date funds
were received into escrow (or directly by the Corporation if there
was no escrow) in an aggregate amount sufficient for the payment to
purchase the corresponding number of Series F Convertible Preferred
Share certificates subscribed to for such closing and the escrow is
cleared and the certificates underlying the Series F Convertible
Preferred Shares are distributed.
2. Automatic Conversion. Each share of Series F Convertible
Preferred Shares outstanding on the date which is two (2) years after
the Closing Date automatically shall be converted into Common Stock
on such date at the Conversion Price then in effect (calculated in
accordance with the Formula in section 7(a) above), and the date
which is two (2) years after the particular Closing Date shall be
deemed the date of conversion with respect to such conversion.
(c) Conversion Notice. The right of conversion shall be exercised
by the Holder thereof by telecopying an executed and completed
written notice (the Conversion Notice) to the Corporation (the
Conversion Date) that the Holder elects to convert a specified number
of shares of Series F Convertible Preferred Shares representing a
specified Stated Value thereof into Common Stock and by delivering by
express courier for overnight or two day delivery the original
Conversion Notice and a certificate or certificates of Series F
Convertible Preferred Shares being converted to the Corporation at
its principal office (or such other office or agency of the
Corporation as the Corporation may designate by notice in writing to
the Holders of the Series F Convertible Preferred Shares), together
with a statement of the name or names (with address) in which the
certificate or certificates for shares of Common Stock shall be
issued.
(d) Issuance of Certificates - Time Conversion Effected. The
Corporation will transmit the certificates representing shares of
Common Stock issuable upon conversion of any Series F Convertible
Preferred Shares to the Holder via express courier, by electronic
transfer or otherwise, within three business days after the
Conversion Date if the Company has received the original Conversion
Notice and Series F Convertible Preferred Share certificate(s) being
so converted by the second business day after the Conversion Date.
In the event the Corporation has not received the original Notice of
Conversion and the Series F Convertible Preferred Shares
certificate(s) being so converted by the second business day after
the Conversion Date then the Corporation shall be obligated to
transmit the certificates representing shares of Common Stock
issuable upon conversion of any Series F Convertible Preferred Shares
within one business day after receipt of the original Conversion
Notice and Series F Convertible Preferred Share certificate(s) being
so converted. In addition to any other remedies which may be
available to the Holders, in the event that the Corporation fails to
effect delivery of such shares of Common Stock as set forth above in
this paragraph, the Holders will be entitled to revoke the relevant
Notice of Conversion by delivering a notice to such effect to the
Corporation whereupon the Corporation and the Holders shall each be
restored to their respective positions immediately prior to delivery
of such Conversion Notice.
(e) Fractional Shares: Dividends; Partial Conversion. No
fractional shares shall be issued upon conversion of Series F
Convertible Preferred Shares into Common Stock. All fractional shares
shall be rounded up to the nearest whole share. In case the number of
shares of Series F Convertible Preferred Shares represented by the
certificate or certificates surrendered pursuant to Subparagraph 7(a)
exceeds the number of shares converted, the Corporation shall, upon
such conversion, execute and deliver to the Holder within 7 business
days, at the expense of the Corporation, a new certificate or
certificates for the number of shares of Series F Convertible
Preferred Shares represented by the certificate or certificates
surrendered which are not to be converted.
(f) Reorganization or Reclassification. If any capital
reorganization or reclassification of the capital stock of the
Corporation shall be effected in such a way that holders of Common
Stock shall be entitled to receive stock, securities or assets with
respect to or in exchange for Common Stock, then, as a condition of
such reorganization or reclassification, lawful and adequate
provisions shall be made whereby each Holder of a share or shares of
Series F Convertible Preferred Shares shall thereupon have the right
to receive, upon the basis and upon the terms and conditions
specified herein and in lieu of the shares of Common Stock
immediately theretofore receivable upon the conversion of such share
or shares of Series F Convertible Preferred Shares, such shares of
stock, securities or assets as may be issued or payable with respect
to or in exchange for a number of outstanding shares of such Common
Stock equal to the number of shares of such Common Stock immediately
theretofore receivable upon such conversion had such reorganization
or reclassification not taken place, and in any such case appropriate
provisions shall be made with respect to the rights and interests of
such Holder to the end that the provisions hereof (including without
limitation provisions for adjustments of the conversion rights) shall
thereafter be applicable, as nearly as may be, in relation to any
shares of stock, securities or assets thereafter deliverable upon the
exercise of such conversion rights.
(g) Adjustments for Splits, Combinations, etc. The Conversion Price
and the number of shares of Common Stock into which the Series F
Convertible Preferred Shares shall be convertible shall be adjusted
for stock splits, combinations, or other similar events.
Additionally, an adjustment will be made in the case of an exchange
of Common Stock, consolidation or merger of the Corporation with or
into another corporation or sale of all or substantially all of the
assets of the Corporation in order to enable the Holder of Series F
Convertible Preferred Shares to acquire the kind and the number of
shares of stock or other securities or property receivable in such
event by a Holder of the Series F Convertible Preferred Shares of the
number of shares that might otherwise have been issued upon the
conversion of the Series F Convertible Preferred Shares. No
adjustment to the Conversion Price will be made for dividends (other
than stock dividends), if any, paid on the Common Stock or for
securities issued for fair value.
8. Interest. 8% per annum on the Stated Value of the Series F
Convertible Preferred Shares in cash, or at the Corporation's option
in Common Stock, due and payable upon conversion. Interest shall
accrue from and after the Closing Date.
9. Redemption of Series F Convertible Preferred Shares.
(a) Right to Redeem Series F Convertible Preferred Shares. At any
time, prior to receiving a Conversion Notice and from time to time,
the Corporation may, in its sole discretion, but shall not be
obligated to, redeem, in whole or in part, the then issued and
outstanding shares of Series F Convertible Preferred Shares, by
paying to the Holder the Redemption Price as defined as follow: (i)
from the Closing Date until 30 days after the Closing Date, the
Redemption Price shall equal the Stated Value of the Series F
Convertible Preferred Shares plus a premium of 15% of the Stated
Value; (ii) from the 31st day after the Closing Date until the 60th
day after the Closing Date, the Redemption Price shall equal the
Stated Value of the Series F Convertible Preferred Shares plus a
premium of 20% of the Stated Value; (iii) after the 60th day from the
Closing Date, the Redemption Price shall equal the gross proceeds the
Holder would have realized upon conversion and simultaneous sale of
each share of Common Stock that would be issuable to the Holder had
the Holder submitted a Conversion Notice to the Corporation on the
date the Corporation issues the Notice of Redemption referred to in
subparagraph 9(b). If the Company elects to redeem some, but not
all, of the Series F Convertible Preferred Shares, the Company shall
redeem a pro-rata amount from each Holder of the Series F Convertible
Preferred Shares.
(b) Notice of Redemption. The Corporation shall provide each holder
of record of the Series F Convertible Preferred Shares with written
notice of redemption (the "Redemption Notice") not less than 10
business days prior to any date stipulated by the Corporation for the
redemption of the Series F Convertible Preferred Shares (the
"Redemption Date"). The Redemption Notice shall contain (i) the
Redemption Date, (ii) the number of shares of Series F Convertible
Preferred Shares to be redeemed from the Holder to whom the
Redemption Notice is delivered, (iii) instructions for surrender to
the Corporation of the certificate or certificates representing the
shares of Series F Convertible Preferred Shares to be redeemed, and
(iv) specification by the Corporation of the number of shares of
Series F Convertible Preferred Shares to be redeemed as provided in
this Paragraph 9, and (v) the applicable Redemption Price. The Holder
may exercise the conversion rights granted herein up until the day
preceding the Redemption Date so long as such date falls after the 89
day period referred to in Section 7(b)1.
(c) Surrender of Certificates: Payment of Redemption Price. On or
before the Redemption Date, each Holder of the shares of Series F
Convertible Preferred Shares to be redeemed shall surrender the
required certificate or certificates representing such shares to the
Corporation within eight (8) business days from the date of receipt
of the Redemption Notice, in the manner and at the place designated
in the Redemption Notice, and upon such surrender, the Redemption
Price for such shares shall be paid by the Corporation within 2
business days via wire transfer to the order of the person whose name
appears on such certificate or certificates as the owner thereof, and
each such surrendered certificate shall be canceled and retired. If a
certificate is surrendered and all the shares evidenced thereby are
not being redeemed, the Corporation shall issue new certificates to
be registered in the names of the person(s) whose name(s) appear(s)
as the owners on the respective surrendered certificates and deliver
such certificate to such person(s).
10. Notices.
In case at any time:
(a) the Corporation shall declare any dividend upon its Common Stock
payable in cash or stock or make any other pro rata distribution to
the holders of its Common Stock; or
(b) the Corporation shall offer for subscription pro rata to the
holders of its Common Stock any additional shares of stock of any
class or other rights; or
(c) there shall be any capital reorganization or reclassification of
the capital stock of the Corporation, or a consolidation or merger of
the Corporation with or into, or a sale of all or substantially all
its assets to, another entity or entities; or
(d) there shall be a voluntary or involuntary dissolution,
liquidation or winding up of the Corporation;
then, in any one or more of said cases, the Corporation shall give,
by first class mail, postage prepaid, and by telex or facsimile, or
by recognized overnight delivery service to non-U.S. residents,
addressed to each Holder of any shares of Series F Convertible
Preferred Shares at the address of such Holder as shown on the books
of the Corporation, (i) at least 10 days prior to written notice of
the date on which the books of the Corporation shall close or a
record shall be taken for such dividend, distribution or subscription
rights or for determining rights to vote in respect of any such
reorganization, reclassification, consolidation, merger, sale,
dissolution, liquidation or winding up and (ii) in the case of any
such reorganization, reclassification, consolidation, merger, sale,
dissolution, liquidation or winding up, at least 10 days prior
written notice of the date when the same shall take place. Such
notice in accordance with the foregoing clause (i) shall also
specify, in the case of any such dividend, distribution or
subscription rights, the date on which the holders of Common Stock
shall be entitled thereto and (ii) shall also specify the date on
which the holders of Common Stock shall be entitled to exchange their
Common Stock for securities or other property deliverable upon such
reorganization, reclassification, consolidation, merger, sale,
dissolution, liquidation or winding up, as the case may be.
11. Shares to be Reserved.
The Corporation, upon the effective date of this Certificate of
Designation, has a sufficient number of shares of Common Stock
available to reserve for issuance upon the conversion of all
outstanding shares of Series F Convertible Preferred Shares, pursuant
to the terms and conditions set forth in Paragraph 7. The Corporation
will at all times reserve and keep available out of its authorized
Common Stock, solely for the purpose of issuance upon the conversion
of Series F Convertible Preferred Shares as herein provided, such
number of shares of Common Stock as shall then be issuable upon the
conversion of all outstanding shares of Series F Convertible
Preferred Shares. The Corporation covenants that all shares of Common
Stock which shall be so issued shall be duly and validly issued. The
Corporation will take all such action as may be so taken without
violation of any applicable law or regulation, or of any requirement
of any national securities exchange upon which the Common Stock may
be listed to ensure there are a sufficient number of shares of Common
Stock authorized and issued to fulfill the Corporation's obligation
to any Holders to issue such Common Stock upon receipt of a
Conversion Notice. The Corporation will use its best efforts to
ensure the total number of shares of Common Stock issued and issuable
after such action upon conversion of the Series F Convertible
Preferred Shares would not exceed the total number of shares of
Common Stock then authorized by the Corporation's Certificate of
Incorporation, as amended.
12. No Reissuance of Series F Convertible Preferred Shares.
Shares of Series F Convertible Preferred Shares which are converted
into shares of Common Stock as provided herein shall not be reissued.
13. Issue Tax.
The issuance of certificates for shares of Common Stock upon
conversion of Series F Convertible Preferred Shares shall be made
without charge to the Holder for any United States issuance tax in
respect thereof, provided that the Corporation shall not be required
to pay any tax which may be payable in respect of any transfer
involved in the issuance and delivery of any certificate in a name
other than that of the Holder of the Series F Convertible Preferred
Shares which is being converted.
14. Closing of Books.
The Corporation will at no time close its transfer books against the
transfer of any Series F Convertible Preferred Shares or of any
shares of Common Stock issued or issuable upon the conversion of any
shares of Series F Convertible Preferred Shares in any manner which
interferes with the timely conversion of such Series F Convertible
Preferred Shares, except as may otherwise be required to comply with
applicable securities laws.
15. Definition of Common Stock.
As used in this Certificate of Designation, the term "Common Stock"
shall mean and include the Corporation's authorized Common Stock, as
constituted on the date of filing of these terms of the Series F
Convertible Preferred Shares, and shall also include any capital
stock of any class of the Corporation thereafter authorized which
shall neither be limited to a fixed sum or percentage of par value in
respect of the rights of the holders thereof to participate in
dividends nor entitled to a preference in the distribution of assets
upon the voluntary or involuntary liquidation, dissolution or winding
up of the corporation; provided that the shares of Common Stock
receivable upon conversion of shares of Series F Convertible
Preferred Shares shall include only shares designated as Common Stock
of the Corporation on the date of filing of this instrument, or in
case of any reorganization, reclassification, or stock split of the
outstanding shares thereof, the stock, securities or assets provided
for in Paragraph 7 hereof.
16. Amendments.
No provision of these terms of the Series F Convertible Preferred
Shares may be amended, modified or waived without the written consent
or affirmative vote of the Holders of at least a majority of the then
outstanding shares of Series F Convertible Preferred Shares.
SECOND:
That said determination of the designation, preferences and relative,
participating, optional or other rights, and the qualifications,
limitations or restrictions thereof, relating to the Class A
Preferred Shares - Series F was duly made by the Board of Directors
pursuant to the provisions of the Corporation's Certificate of
Incorporation and in accordance with the provisions of the General
Corporation Law of the State of Colorado.
IN WITNESS HEREOF, this Certificate has been signed by Joseph J.
Murphy, President and Larry Shatsoff Acting Secretary, this 30th day
of April, 1998.
/s/ Joseph J. Murphy /s/ Larry Shatsoff
- --------------------------- --------------------------------
Joseph J. Murphy, President Larry Shatsoff, Acting Secretary
Exhibit 4
---------
Specimen Common Stock Certificate
Number DCI TELECOMMUNICATIONS, INC. Shares
DCI ____ ** __ **
Incorporated under CUSIP 233094 20 0
the laws of the State
of Colorado
This certifies that ________________ is the owner of _________
Fully paid and non-assessable shares of common stock of the par value
of $0.0001 per share of
--------------- DCI TELECOMMUNICATIONS, INC. -------------
transferable on the books of the Corporation by the holder hereof in
person or by duly authorized Attorney, upon surrender of this
Certificate, properly endorsed.
This Certificate is not valid until countersigned and registered by
the Transfer Agent and Registrar.
WITNESS the facsimile seal of the Corporation and the facsimile
signatures of its duly authorized officers.
Date: _______________
- --------------------- ---------------
Secretary President